European shares fell yesterday as disappointing US jobs figures spurred investors to book profits after the market hit its highest level in 29 months. European technology leader Nokia fell 2.8 per cent after the Finnish handset maker said the head of its networks unit had resigned and another senior networks executive left in a second round of departures in two weeks.
Chip-related shares like Infineon, STMicroelectronics and ASML rose after US chip bellwether Intel lifted its revenue outlook.
The FTSEurofirst 300 index ended unofficially down 0.3 per cent at 1,035.05 points after hitting its highest level since July 2002 early in the session.
For the week, the pan-European blue-chip benchmark was up 0.6 per cent.
The mood turned sour on news that the US economy created 112,000 jobs in November, well below the 180,000 that Wall Street economists were expecting, raising concerns about the durability of US consumer demand, the key driver of growth.
"Payrolls have lived up to the reputation of being a monthly lottery," said John Shepperd, global economist at Dresdner Kleinwort Wasserstein investment bank.
"It is a gloomy report all round and takes out of the market some of the excessive optimism. The Federal Reserve is probably still biased to increase rates in December but we think that could be the last rate rise for some time," Mr Shepperd said.
The Fed will discuss interest rates on December 14 and financial markets were already betting on a quarter of a percentage point rise in borrowing costs.
The DJ Euro Stoxx 50 index, which tracks euro zone blue chips, ended unofficially down 0.5 per cent at 2,911.59 points.
Dealers said European shares were ripe for a correction after a two-day rally on the back of a rout in crude oil prices which cuts a key cost for companies.
"People are using the data as an excuse to take profits on a Friday afternoon," said Daniel Birch, a dealer at Execution stockbrokers.
"Our stance is that with the profit you have made, that in the last 20 days or so of trading left this year you should start buying defensives such as good quality value stocks and get out of the noisy momentum stocks," Mr Birch said.
Crude oil prices continued to fall for a third day, helping to put a floor under the stock market's losses.
Among the day's other standouts, shares in ABB sank 12 per cent to 6.2 Swiss francs after a US appeals court unexpectedly rejected its bid for a $1.2 billion asbestos settlement.